Parliament backs overhaul of how EU is funded - with more money for young people and tackling climate change. Fake pro-Europeans instead abstain

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The European Parliament today backed an ambitious reform of how the EU is financed. The Parliament voted on two joint reports, one on Parliament’s vision for the next multiannual financial framework (MFF) and one calling for new means of raising genuine own resources for the EU budget, instead of relying on annual contributions from member states.

S&D vice-president Isabelle Thomas MEP, co-author of the Parliament’s report on the next MFF, said:

“To meet all the challenges it faces, from youth unemployment, lack of investment, climate change, and migration to unexpected new ones, the European Union needs a stronger and more flexible budget. In response to these challenges and the UK leaving, the Parliament today voted in favour of an ambitious post-2020 European budget, including a proposal to increase it to 1.3% of EU27 gross national income. Above all, it enshrines an essential principle: there can be no new European policy without additional means to carry it out.

“To achieve this, the Parliament demands a reform of the EU financing system. The budget can no longer be based mainly on the contributions of the member states. This financing system means, in practice, a budget reduction year after year. New own resources must be introduced, such as the Financial Transaction Tax, a tax on multinationals, and a carbon adjustment mechanism at the EU’s borders. As its consent is necessary for the adoption of the next MFF, the European Parliament makes a commitment: it will not vote for any deal until new own resources are included as income for the European budget.”

“This crucial vote for the future of Europe was a moment of truth for pro-Europeans. Today Guy Verhofstadt and part of the Alde Group, including the chairman of the budget committee, Jean Arthuis, surprisingly decided to abstain for merely cheap internal political reasons. The S&D Group names and shames this unacceptable behaviour – you cannot claim to be pro-European then abstain on an ambitious and pro-European vision of the next MFF. Despite this surprising decision, we are delighted the report passed with such a large majority.

S&D Group spokesperson for the report on own resources, Daniele Viotti, added:

“The S&D Group will not vote in favour of a new long term EU budget, that does not radically overhaul how it is financed. We need to scrap the current rebates, starting from the UK correction, as well as compensations and replace them with a fair and transparent system for all member states. We also need to find new ways of funding the EU budget, to ease pressure on member states’ finances, compensate the upcoming Brexit gap and ensure the EU budget is funded in an equitable and sustainable way. This should be done by increasing the amount raised by own resources. We want to see the total share of member state contributions to the EU budget to be reduced to a maximum level of 40 %, rather than current 69%. Own resources could come from part of the revenues stemming from a tax on multinational companies, targeting also the digital sector, a financial transaction tax and green taxation, such as the income arising from the Emission Trading Scheme against climate change.”

“Currently, Europe is not delivering enough for its citizens. National governments are calling on the EU to do more and more tasks but they are also refusing to give it the means to do this. This creates a gap between expectation and reality - leading to frustration with the EU. It does not have to be like this. We are demanding a well-funded EU budget focused on the things citizens want and tackling the biggest issues facing the planet. We are calling for a budget that allows Europe to be at the forefront of meeting the UN’s Sustainable Development Goals - to help end poverty, address climate change and promote gender equality.”